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equivalence scales. The most commonly used scales include the
square root scale (applied here), (old) OECD scale (i.e. household
head=1, each additional adult=0.7, each child=0.5), and
OECD-modified scale (i.e. household head=1, each additional
adult=0.5, each child=0.3) (Förster, 1994; Hagenaars, de Vos, &
Zaidi, 1994). For sensitivity tests, I replicated the analyses using
the OECD-modified scale. As Burniaux et al. (1998) suggest, while
poverty levels may vary depending on different equivalence scales,
the trends of poverty over time and the rankings across countries
are less likely to be affected. The results and discussion are
provided in Appendix B.
B. BTST Income Poverty, Welfare Effectiveness,
and Household Composition
The three structural predictors of youth poverty are the
market, social welfare, and household composition.
The effect of
market income poverty
, aiming to evaluate young adults’ relative
deprivation in the market income distribution, is measured by the
relative poverty rates based on household income before taxes and
social transfers (“
BTST income poverty
”, or before tax and social
transfer income poverty, is used in the following sections) across
household types. Although relative poverty and inequality are
conceptually and methodologically different, the calculation of
relative poverty is interlinked with the measurement of inequality
(Foster, 1998; Foster & Shorrocks, 1988). BTST income consists of
wages, salaries, property cash income, occupational pensions, and
other market income components but excludes any social transfers.
Similar to calculation of the poverty line and poverty rate based on
net disposable income, the BTST income poverty line is income
below 50% of the median equivalized household BTST income.
Welfare effectiveness
is measured by the ratio of poverty rates
based on net disposable income (after taxes and after social
transfers) to the poverty rates based on BTST income. That is,
welfare effectiveness is evaluated in terms of how much BTST